Pohang Iron and Steel Co. Ltd. (POSCO), a major steel-making mill in South Korea, reported its CY ’20 results.
SteelMint’s inferences from the investor’s presentation
- Crude steel output slumped by 6% in CY ’20- POSCO’s crude steel output fell to 35.93 mn t in CY ’20 in contrast to 38.1 mn t in the previous year, declining by 6% due to flexible operation towards slow orders and revamp of Gwangyang #3 BF
- Sale volumes dropped down by 5% in CY ’20- The company’s sales output reported a decline of 5% to 34.27 mn t in CY ’20 as against 35.99 mn t in the corresponding period last year. Passive demand from the end users majorly because of the on-going pandemic was the reason behind dropping sales.
- Domestic sales inched down by 5% in CY ’20- The manufacturer sold around 18.968 mn t in the domestic market in CY ’20 against 19.909 mn t in CY ’19.
- Carbon steel sales prices slid by 8% in CY ’20- Carbon steel prices stood at KRW 662 thousand in CY ’20 down by 8% in comparison with KRW 722 thousand in the previous year. However, the company’s sale of high-value added products witnessed an increase in the latter half of CY ’20.
- Capacity utilization rate declined in CY ’20- The mills produced at a reduced capacity of about 88% in CY ’20 majorly due to the limited work force and stricter regulation to reduce COVID-19 infection cases. In CY ’19, the company produced at 89.7% of its rated capacity.
- POSCO Maharashtra posts sharp increase in Operating profit in CY ’20- The Operating profit of company’s Maharashtra based plant went up from $3 million in CY ’19 to a whopping $20 million in CY ’20. Soaring domestic market prices in India since Aug ’20 and recovery in demand since Sep ’20 were the leading factors.
Plans for CY ’21- The company has laid out plans for CY ’21 focusing on higher crude steel production at 37.80 mn t and product sales of 35.30 mn t. Further, the company aims to achieve revenue of KRW 27.9 trillion along with a capital expenditure of KRW 3.9 trillion in the upcoming year.
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